President Obama's Nuclear Reversal

President Obama announced Tuesday that the Department of Energy is awarding $8 billion in taxpayer dollars towards loan guarantees
to build the United States' first nuclear reactors in nearly thirty
years. This move may be politically expedient, but for the public, it's
a raw deal.

As a candidate, Obama expressed openness to new reactors, but said,
"Before an expansion... is considered, key issues must be addressed
including: security of nuclear fuel and waste, waste storage, and

President Obama should heed candidate Obama's advice. These issues have not been addressed. If anything, the challenges facing the nuclear industry have grown worse.

With Yucca Mountain a no-go,
there is still nowhere to put the radioactive waste piling up across
the country. New reactors would only add to the waste problem and could
increase pressure to reprocess spent fuel, a dangerous and costly
scheme that would increase waste streams.

There's also still no way to ensure reactors' safety. Reports of Homer Simpson-like lapses by staff at reactor sites abound, and the FBI has called nuclear facilities "target rich" environments for terrorists. More reactors also mean more weapons-usable material, increasing the risk of proliferation.

The fiscal implications of President Obama's position are alarming.
For decades, the industry has depended on taxpayer support. Investing
in emerging technologies that can eventually thrive on their own makes
sense, but the nuclear industry doesn't fit the bill. After more than
50 years as one of the biggest recipients of federal subsidies, the
industry should sink or swim on its own.

Many on Capitol Hill complain that within the climate debate, the
nuclear industry isn't getting its fair share of attention. Some, like
Senators Lamar Alexander (R-Tenn.) and Jim Webb (D-Va.) propose to remedy this with a new, hundred-billion dollar subsidy plan.

But the premise that the industry has been given short-shrift is
false. Nuclear reactors have received more preferential treatment than
any other source of electricity. Even today, the industry is slated to
receive more federal loan guarantees, a host of tax credits for nuclear
power production, and insurance subsidized through the Price Anderson Act, which was renewed for 20 years in 2005.

Investments in nuclear plants are deemed too risky by private
industry (even before the financial crisis, Wall Street banks refused
to grant loans for reactors, which tells you something), so the nuclear
industry relies on loan guarantees from the federal government for new
construction. The Congressional Budget Office has estimated that the risk of default on such loans is "very high -- well above 50 percent." President Obama's new budget dedicates more than $50 billion to nuclear loan guarantees. Taxpayers could be left on the hook for a massive bailout.

The firms angling to profit from new reactors, including
Westinghouse, General Electric and Exelon, as well as electric
utilities, are some of the wealthiest corporations in the country.
Especially now, with deficits running so high, they should not become
the beneficiaries of new government largess.

Nuclear industry lobbyists love to point to France to argue that having
lots of reactors can work. But France has not solved its waste problem,
and it faces a host of challenges from its nuclear facilities, such as a radioactive leak
that recently forced the closure of two rivers. In the U.S., three
times the legally safe amount of radioactive tritium, a cancer-causing
carcinogen, has been detected in the groundwater along the Connecticut
River in Vermont, leaking from pipes in the Vermont Yankee reactor. This news comes on the heels of the admission by the owner of the reactor that it willfully deceived
lawmakers about its safety. And when it comes to the laudable goal of
reducing carbon emissions, there are speedier and more affordable
options. Truly clean options, including efficiency and wind and solar
power, should be the focus.

In his remarks in Maryland on Tuesday, President Obama appealed to
an international "race to... command growing energy industries" and
invest in new technologies. But nuclear power is as old as the hula
hoop, and is just as technologically advanced. President Obama should
ditch this failed industry
and take the lead on investing in truly clean, safe, and financially
viable solutions to our energy crisis, rejecting the industry's
rhetoric and abandoning this false solution.

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